The Northern Transportation Systems Assessment - NWT & Nunavut ...

EXECUTIVE SUMMARY 

THE NORTHERN 

TRANSPORTATION 

SYSTEMS ASSESSMENT 

Executive Summary 

January 2011 

PROLOG CANADA INC. PAGE 1

NORTHERN TRANSPORTATION SYSTEMS ASSESSMENT 

Disclaimer 

This report reflects the views of PROLOG Canada Inc. only and does not 

necessarily reflect the official views or policies of Transport Canada. 

Neither Transport Canada, nor its employees, makes any warranty, express or 

implied, or assumes any legal liability or responsibility for the accuracy or 

completeness of any information contained in this report, or process described 

herein, and assumes no responsibility for anyone’s use of the information. 

Transport Canada is not responsible for errors or omissions in this report and 

makes no representations as to the accuracy or completeness of the information. 

Transport Canada does not endorse products or companies. Reference in this 

report to any specific commercial products, process, or service by trade name, 

trademark, manufacturer or otherwise does not constitute or imply its 

endorsement, recommendation, or favouring by Transport Canada and shall not 

be used for advertising or service endorsement purposes. Trade or company 

names appear in this report only because they are essential to the objectives of 

the report. 

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PROLOG CANADA INC.


THE NORTHERN 

TRANSPORTATION 

SYSTEMS ASSESSMENT 


Prepared for Transport Canada 

Prepared by PROLOG Canada Inc. 

In Association with EBA Engineering Consultants Ltd. 

January 2011 



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PROLOG CANADA INC.


1. Introduction 

Northern Transportation Systems Assessment 


The purpose of the Northern Transportation Systems Assessment is to determine what 

transportation infrastructure is required to support growing demand in the North over the 

next 20 years; and to determine what incremental improvements will build towards a 

transportation system that supports Canada’s vision for northern development. That objective 

has been met in two phases: Phase 1 is a Transportation Demand Assessment and Phase 2 is 

an Infrastructure Needs Assessment. 

Phase 1 has analyzed demand for the following current transportation systems supplying both 

communities and resource developments in the North: 

Eastern Sealift System – break bulk general cargo ships and bulk fuel product tankers 

with sailings from the East originating traffic to the Kivalliq, Qikiqtaaluk and Kitikmeot 

regions of Nunavut. 

Western Sealift System – combination deck cargo/bulk fuel Mackenzie River barges 

or deep draft ocean vessels with sailings from the West originating traffic to the Nunavut 

and NWT Western Arctic Coast. 

Inland Marine Systems – a combination of intermodal container/trailer services and 

integrated marine and rail or road bulk commodity hauls within Hudson Bay, the 

Mackenzie Valley and the Alaska/B.C. Inside Passage. 

Highway Transport Systems – a range of roads from the relatively extensive Yukon 

heavy haul highway system; to all-weather highways extended by winter/ice roads in 

NWT; to no roads at all in Nunavut. 

Air Passenger & Cargo Systems – Northern Regional Airports at Iqaluit, Rankin 

Inlet, Yellowknife and Whitehorse linked to Southern Gateway Airports at Montreal, 

Ottawa, Winnipeg, Edmonton, Calgary and Vancouver. 

Phase 2 includes a recommended approach for developing each of these systems based on an 

objective financial assessment of northern transportation infrastructure needs. 

Yukon Mineral Concentrate Heavy 

Haul Truck Transport to Closest 

Tidewater at Skagway, Alaska 



The Phase 1 Transportation Demand Assessment has set the baseline for current traffic flows 

over the following northern transportation systems: 

Northern Transportation Systems Demand 

(Tonnes in 2009) 

Northern 

Transportation 

System 

Community 

Resupply 

General 

Resource 

Projects 

General 

Bulk 

Fuel 

Supply 

Total 

Inbound 

Tonnes 

Eastern Sealift 54,500 39,100 139,900 233,500 

Western Sealift 3,700 3,800 59,000 66,500 

Mackenzie River 8,900 3,900 26,200 39,000 

Hudson Bay 4,300 27,300 38,500 70,100 

Inside Passage* 59,400 24,100 64,000 147,500 

Yukon Highways 371,000 143,900 121,900 636,800 

NWT Highways 163,000 48,000 300,000 511,000 

TOTAL INBOUND 605,400 266,000 685,500 1,556,900 

Northern Air Cargo 20,000 

Resource Exports 54,000 

TOTAL TONNES 1,630,900 

* Inside Passage Tonnes are included in Yukon Highways Tonnes and excluded from Total Tonnes. 

Air North and Canadian North Combi Aircraft at Inuvik Airport 

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PROLOG CANADA INC.


From these current demand statistics the following traffic split shows that: 

Yukon Highways carry the most northern traffic (over 40%); 

Nunavut Sealift and NWT Mackenzie River traffic is about a quarter of the total; 

Northwest Territories Highways carry a third of northern traffic and of that total; 

Fuel is approximately 60% of the Northwest Territories Highways traffic. 

Current Inbound Freight Traffic Split 

Yukon Highways 

636,800 tonnes 

(41%) NWT 

NWT Highways 

Highways 

60% Fuel 

511,000 

tonnes 

40% General 

(33%) 

NWT/Nunavut Marine 

409,100 tonnes 

(26%) 

(tonnes in 2009) 

The modal split shifts across the North: 

From exclusively Sealift in the roadless Eastern Arctic; 

To a mix of Highway, Mackenzie River and Sealift in the Northwest Territories; 

To a preponderance of trucking on the extensive Yukon Highway System. 

Northern transport systems demand development includes traffic generated by resource 

projects that are currently active. As well, forecasts extended from current baseline traffic are 

augmented with assessment of resource development projects that may take place over the 

next 20 years. 

Northern Transport Demand Freight Forecast Summary (tonnes) 

2010 2015 2020 2025 2030 

Community General 443,557 459,499 474,226 489,032 503,737 

Resource General 94,100 846,100 1,193,000 375,000 322,000 

Bulk Fuel Supply 718,986 1,142,164 1,233,712 1,017,954 908,614 

Total Inbound 1,256,643 2,447,763 2,900,938 1,881,986 1,734,351 

Outbound 112,000 1,381,000 19,556,600 19,320,600 18,820,600 

Induced Demand* 18,820 169,220 238,600 75,000 64,400 

*A .20 induced impacts multiplier is applied to development freight to account for the additional traffic 

demand that can be expected with spin-off economic activity from resource development projects. Induced 

demand is shown for information only and not included in the totals. 



The following chart shows for northern transportation systems traffic demand: 

Historical growth during the decade from 1997 to 2007; 

Recent decline through the economic recession to 2010; and 

Resumed resource development driven growth forecast through 2020. 

Source: PROLOG Northern Territories Transportation Systems Study (1998) for 1997 data 

and PROLOG contemporary and forecast demand statistics presented in the Phase 1 Report. 

Mackenzie River East Channel Winter Ice Road 

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PROLOG CANADA INC.


The Phase 2 Infrastructure Needs Assessment builds on results of the Phase 1 Demand 

Assessment to: 

Compare existing transportation capabilities and constraints with proposed 

infrastructure investments to determine potential performance changes in future cost, 

service or reliability. 

Apply potential performance changes to recast modal split projections, analyze 

transportation system reconfigurations, and monetize future infrastructure 

savings/benefits versus costs. 

Screen future infrastructure savings/benefits versus costs to help set northern 

transportation system investment priorities over a 20 year planning horizon. 

The Phase 2 Assessment looks at major infrastructure needs with an eye for potential or 

existing multi-use facilities that can share the required investment among multiple users. 

The Assessment also identifies incremental options for staged building of the large scale 

infrastructure projects that are proposed for improving transportation in the North. 

The Phase 2 Assessment provides a high-level financial analysis of major infrastructure 

investment proposals based on quantifiable savings that relate directly to the costs of moving 

goods in the North. However, many aspects of northern infrastructure needs are not so easily 

quantified. These include: 

Transportation safety and cargo security; 

Spill prevention and tanker systems integrity; 

Remote Community access and development; and 

Environmental Protection in a changing Northern Climate. 

To the extent that potential investments indentified in the Phase 2 Infrastructure Needs 

Assessment can also provide benefits beyond transportation efficiency and cost savings, these 

benefits are important to balance the decision making process. 

Google Earth Image of Sealift Tanker Discharge at Iqaluit Inuit Head Pipeline Header. 



2. Canadian Arctic Sealift System 

Over the next 20 years, the Canadian Arctic Sealift System is anticipated to encounter a 

warmer climate with an extended shipping season that will see: 

Increasing options for community resupply sealift; 

Reduced risk for resource development sealift; 

Greater international arctic activity; and 

Corresponding strategic national initiatives. 

However, an extended sealift season will not create much commercial attraction for cargo 

ships to transit the Canadian Northwest Passage on a regular basis. 

The Russian Northern Sea Route is a shorter, more attractive passage between Europe and 

Asia – which is the major merchant marine market. Market economics will determine 

whether commercial ships will transit the Canadian Northwest Passage. A more relaxed ice 

regime will not make any difference without a market. 

Ship owners see Canada’s arctic as a destination market, rather than part of an international 

trade route. However, the lack of permanent marine facilities at arctic coastal destinations can 

constrain progress for community and resource development that, short of air access, is 

otherwise stranded without sealift. 

A warming climate and extended shipping season are fostering new sealift supply chains for 

coastal destinations: 

Eastern Arctic Sealift ship owners are expanding into the Western Arctic; and 

Western Arctic Sealift is shifting from Mackenzie River barges to Pacific Coast vessels. 

Non-commercial Canadian initiatives are also adding marine activity with a High Arctic 

Research Station at Cambridge Bay and an Arctic Training Centre joining the Polar 

Continental Shelf Project at Resolute Bay. As well a new fleet of Navy Arctic/Offshore Patrol 

Vessels and Coast Guard ice breakers are to be supported from Nanisivik. 

Recommended Approach for Eastern Sealift 

Seek development of multifunctional facilities that can more cost-effectively 

serve emerging resource industry needs in combination with ongoing 

Nunavut resupply reliability requirements; and ensure community marine 

infrastructure capability for: 

Safe, secure landing and distribution of dry cargo; and 

Environmentally secure fuel transfers with effective tanker systems. 

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PROLOG CANADA INC.


The Canadian Arctic Sealift System has been screened for potential performance changes and 

parallel infrastructure needs in both the Eastern Arctic and the Western Arctic. 

In the Eastern Arctic - where a sealift beach is the typical marine terminal facility, these 

include: 

Public sector opportunities to reduce sealift costs and increase sealift reliability with 

regional distribution as inter-community roads are developed in the Kivalliq Region; and 

with incremental investment in permanent port facilities at Iqaluit; and 

Resource sector facilities investment proposed on northern Baffin Island at Steensby Inlet 

and Milne Inlet that will accommodate intensive year around import/export trade 

between Nunavut and Europe as well as summer sealift from Montreal, both with spin-off 

opportunities for Nunavut community resupply. 

Proposed Baffinland Mary River Iron Mine vs. Closed Nanisivik Lead/Zinc Mine 

Nanisivik 

Baffinland 

13,000 

Tonnes of Fuel & Materials/Year 

51,000 

Nanisivik 

Baffinland 

110,000 

Tonnes of Mineral Exports/Year 

18 million 

Over the next 20 years the extent of permanent port infrastructure investment in the Eastern 

Arctic will, in combination with strategic non-commercial initiatives, be dependent upon the 

prospects for: 

Mining industry project specific full port facilities development; and 

Public sector incremental improvement in local and regional sealift facilities. 

Private sector investment for the Mary River Iron Mine project will result in new port 

infrastructure on Baffin Island. Public sector investment is suggested to support regional 

sealift resupply through Iqaluit. A combination of public and private sector investment may 

make sense to develop Rankin Inlet as a regional transportation hub for the Kivalliq region. 

From the Phase 1 Traffic Demand Report, the following traffic projections provide the context 

for Eastern Sealift infrastructure needs assessment in Qikiqtaaluk Region. 

Qikiqtaaluk Eastern Arctic Traffic Projections 

(tonnes/year) 

2010 2015 2020 2025 2030 

Baffinland Iron Ore Exports 9,000,000 18,000,000 18,000,000 18,000,000 

Baffinland Mary River Mine Supply 1,000 107,000 10,000 10,000 10,000 

Baffinland Mary River Mine Fuel 2,000 17,000 41,000 41,000 41,000 

Total Resource Development 3,000 124,000 51,000 51,000 51,000 

Community Fuel Supply 73,596 77,680 81,327 84,464 87,236 

Community Resupply 15,145 15,985 16,736 17,381 17,951 

Mining Induced Resupply* 600 24,800 10,200 10,200 10,200 

Total Inbound Traffic 92,341 242,465 159,263 163,045 166,387 



In the Western Arctic - sealift operations are changing rapidly as a competitive 

marketplace emerges in one of the most remote arctic regions of Canada, characterized by: 

Eastern sealift cargo ships and product tankers entering the western arctic while 

Mackenzie River barges are superseded by ocean vessels from the west coast; and 

A shift from traditional use of river barges that can come alongside shallow draft 

community wharfs, to shallow draft barge shuttles from deep draft ocean vessels. 

Western Sealift 

Ex Vancouver 

$157/tonne fuel 

$478/tonne dry 

Kitikmeot Kitiikmeot 



Eastern Sealift 

Ex Montreal 



Hay River 

Mackenzie River, Rail 

& Road Ex Edmonton 

Ongoing changes in sealift supply and demand will impact infrastructure requirements for 

two ports in the Western Arctic: 

Tuktoyaktuk - the once and future supply 

base for Beaufort Sea/Mackenzie Delta oil 

and gas field development, and the only 

improved port in the Western Arctic with the 

depth of water to allow cargo transfers - but 

with access constrained by an undredged 

channel entrance. 

Coronation Gulf Port and Road - 

infrastructure investment that is required 

before Nunavut base metal mines can be 

developed, but that currently producing 

NWT diamond mines could use as soon as 

available to significantly reduce the cost of 

bulk supply – and to avoid Tibbitt to 

Contwoyto Winter Road warm weather risk – 

providing early revenue certainty for project investment now . 

Recommended Approach for the 

Western Sealift System 

Resource driven infrastructure 

investment in two multi-user, multifunctional 

Western Arctic Sealift hubs: 

Tuktoyaktuk for oil and gas field 

development; and 

Coronation Gulf Port and Road for 

mining development. 

Island Tug and Barge 

photograph of deep draft 

articulated tug barge 

tanker transferring fuel 

to shallow draft river/ 

coastal barges in the 

Western Arctic. 

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PROLOG CANADA INC.


The following table recaps from the Phase 1 Demand Study, ongoing NWT coastal community 

resupply traffic combined with projected resource development traffic and additional “spinoff” 

resupply traffic that will be induced by oil & gas activity. 

FUTURE SLAVE GEOLOGIC PROVINCE MINING FORECAST VOLUMES 

(tonnes/yr) 

MINE 2010 2015 2020 2025 2030 

Base Metal Mines 

Izok Lake Outbound 430,000 430,000 430,000 430,000 

Inbound Fuel 28,000 28,000 28,000 28,000 

Other Bulk 4,000 4,000 4,000 4,000 

Hackett R Outbound 450,000 450,000 450,000 450,000 

Inbound Fuel 30,000 58,000 58,000 58,000 

Other Bulk 34,000 76,000 76,000 76,000 

Total Inbound Bulk 96,000 166,000 166,000 166,000 

Diamond Mines 

Diavik Inbound Fuel 18,000 69,000 69,000 69,000 

Other Bulk 16,000 59,000 59,000 59,000 

Ekati Inbound Fuel 36,000 57,000 57,000 

Other Bulk 5,000 7,000 7,000 

Snap Lake Inbound Fuel 26,000 29,000 29,000 29,000 29,000 

Other Bulk 2,000 6,000 6,000 6,000 6,000 

Gahcho Kue Inbound Fuel 25,000 25,000 25,000 25,000 

Other Bulk 12,000 12,000 12,000 12,000 

Western Sealift System Total Savings Inbound Potential Bulk 103,000 264,000 264,000 200,000 72,000 

With Bathurst Inlet Port Total & Road BIPAR Investment Throughput 103,000 360,000 430,000 366,000 238,000 

Assumptions: 

1. Western The current Sealift diamond mine ratio of bulk commodity BIPAR shipments (Bathurst Inlet to total Port and annual Road) inbound freight volume 

Ex Vancouver 

of 85% applies to the two Nanuvut base metal mines as well - over the long term 

Winter Road 

2. "Other Bulk" commodities includes: Portland cement; shotcrete; and Ammonia Nitrate prills 

Lac de Gras 

Diamond Mines 

$190/tonne bulks 

$236/tonne bulks 

19.5₵/litre fuel 

25.5₵/litre fuel 

Rail Ex 

Edmonton 

NWT Western Arctic Inbound Traffic Projections 

(tonnes/year) 

2010 2015 2020 2025 2030 

Mackenzie Gas Pipeline* 400,000 5,000 5,000 5,000 

Oil&Gas Field Development** 6,000 69,000 73,000 102,000 142,000 

Total Resource Development 6,000 469,000 78,000 107,000 147,000 

Oil&Gas Induced Resupply*** 1,200 93,800 15,600 21,400 29,400 


Total InboundTraffic 23,156 579,376 110,808 146,179 194,842 

* Construction material and resupply traffic spread out along the full Mackenie Valley pipeline right-of-w ay. 

** Includes Central Mackenzie Basin resupply from North or South pending proposed all-w eather road. 

*** Induced traffic assumed as .2 x total resource development traffic. 

While Tuktoyaktuk is projected to resume a proven position as supply base for Mackenzie 

Delta/Beaufort Sea oil and gas projects, feasibility for Slave Geological Province base metal 

mining prospects is dependent upon access to Western Arctic Sealift in Coronation Gulf. As a 

context for potential development of a Coronation Gulf Port and Road to serve both Nunavut 

base metal mines and NWT diamond mines, following are resource development traffic 

forecasts from the Phase 1 Demand Assessment. 

YELLOWKNIFE 

HAY RIVER 

Winter Road 

All Weather Road 

While a Coronation Gulf Port and Road project 

is integral to future Nunavut base metal mining 

feasibility, winter road risk and savings 

benefits for currently producing NWT diamond 

mines can offset advanced project investment 

on a stand-alone basis. 



3. Yukon Resource Access Systems 

Over the next 20 Years, growth in Yukon transportation demand will be driven primarily by 

resource development - principally base metal mineral development. 

Yukon mineral exports in currently average 13,000 tonne ocean shipments will require 1 : 

A ship every 12 days by 2015 

(30 ships at about 400,000 tonnes/year); 


(46 ships at about 600,000 tonnes/year); 


(77 ships at about 1 million tonnes/year); and 

A ship every 3 days beyond 2030 

(115 ships at about 1.5 million tonnes/year). 

Base metal mining transportation demand is subject to 

constraints from two perspectives: 

First - ore terminal storage, berthing and loading capabilities at Skagway, Alaska will 

constrain tidewater access as Yukon mineral exports increase; and 

Second – the remote inland location of Yukon mines means that long distance 

transportation costs to tidewater can constrain mineral production feasibility. 

140 

120 

100 

80 

60 

40 

20 

0 

Yukon Mineral Exports 

Projected Ships/Year 

2010 2015 2020 2025 2030 

These constraints can be relieved with infrastructure investment in: 

Skagway port development to overcome capacity shortfalls 

constraining Yukon mine feasibility and production decisions and 

that can provide up to 70% transportation savings benefits by 

avoiding distant port alternatives; 

CANOL Resource Corridor development between Ross River and 

Carcross to cut 20% of the distance and double the payload that in 

combination can provide up to 65% truck transport savings; 

KLONDIKE Resource Corridor development with initial rail rehab from 

Carcross to Whitehorse providing a 50% savings below truck cost; and 

Full System Cost Reduction Potential 

Standard Gauge Rail & SuperLoad Truck 

(100 Tonne Carloads) (100 Tonne Truckloads) 

Carmacks 

KLONDIKE 

$8.5/Tonne 

(73% (73% reduction) less) 

Whitehorse 

Subsequent standard gauge conversion and extension to Carmacks that can save 

73% of truck cost – but is mutually exclusive with CANOL Corridor development 

that would divert rail traffic threshold density from Carmacks. 

Skagway 

Ross River 

Carcross 

CANOL 

$22/Tonne $18/Tonne 

(58%(65% reduction) less) 

Johnsons 

Crossing 

1 

Future shipment size may increase up to full shiploads of 25,000 to 35,000 tonnes. However, staging full shiploads 

will require much greater ore terminal storage capacity, especially to segregate storage for multiple mines. 

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PROLOG CANADA INC.


As a context for port infrastructure needs at Skagway, following are resource development 

traffic forecasts from the Phase 1 Demand Assessment. 

Phase 1 Mineral Export & Inbound Supply Recap 

Inside Passage Ports Demand Forecast 

A) Short Range Mining Projects (Start-Up within 10 years) 

Producing Mines 

Outbound Tonnes/Year 

Mine Concentrates 2010-15 2015-20 2020-25 2025-30+ 

Minto Copper 65,000 65,000 65,000 

Wolverine Lead/Zinc 45,000 135,000 135,000 

Whitehorse* Magnitite 300,000 

Total MIN Scenario (Total Producing) 410,000 200,000 200,000 

Probable Mines 

Bellekeno Lead/Zinc 20,000 20,000 20,000 

Carmacks Copper (cathodic) 16,000 16,000 

Selwyn Lead/Zinc 320,000 500,000 500,000 

Total MID Scenario (Producing+Probable) 556,000 736,000 500,000 

Possible Mnes 

Casino Copper/Moly 300,000 300,000 

MacTung Tungsten 15,000 15,000 

Total MAX Scenario (Producing+Probable+Possible) 1,051,000 815,000 

B) Longer Range Mining Projects (Start-Up Within 20 Years) 

Potential Additional Mineral Exports 

Marg Zinc/Copper 135,000 

Andrew Lead/Zinc 50,000 

Kud Ze Kyah Lead/Zinc 170,000 

Tom & Jason Lead/Zinc 290,000 

Longer Range Total 1,460,000 

C) Very Long Range Mining Projects (Start-Up Beyond 20 Years) 

Crest Iron Ore 28,000,000 

All Projects 

Inbound Tonnes/Year 

Inbound Traffic 2010-15 2015-20 2020-25 2025-30+ 

Mine Fuel 31,000 95,000 228,000 173,000 

Mine Supply 7,000 29,000 99,000 80,000 

Total Mining Inbound 38,000 124,000 327,000 253,000 

Alaska Gas Pipeline (peak year & ongoing supply) 786,500 3,000 

Oil & Gas Exploration/Development 6,000 

1,113,500 262,000 

Recommended Approach for 

Inside Passage Ports 

Facilitate cost effective Pacific 

port access in Alaska for Canadian 

resource development in Yukon 

with infrastructure investment at 

Skagway to: 

Expand ore terminal capacity 

for an impending influx of 

Yukon mineral exports; 

Load ore ships without 

disrupting a seasonally intense 

cruise ship market; and 

Provide seamless transfer of 

Canadian container and 

general cargo. 

The Alaska Inside Passage Ports - of Haines and Skagway are a key part of Canada’s 

present and future northern transportation system. For Yukon and Mackenzie 

Delta/Beaufort Sea resource development projects, Haines and Skagway offer the closest 

access to ice-free ports. 

Alaska Inside Passage Ports are Canada’s northernmost Pacific Gateways, just 24 kms from 

the Canadian border at Skagway and 72 kms from the Canadian border at Haines. Canadian 

transportation infrastructure provides Alaska Inside Passage port access via: 

The Haines/Alaska Highway from the Port of Haines; 

The Klondike/Dempster Highway from the Port of Skagway; and 

The White Pass railway through British Columbia and Yukon from Skagway. 



Unique geographical circumstances which find the United States separated by Canada from 

Alaska; and Canada separated from the Alaska Inside Passage by a few kilometres in the 

United States, have historically fostered mutually beneficial bilateral cooperation: 

The U.S. built and Canada now maintains the Alaska Highway in B.C. and Yukon; 

Canada has maintained the Klondike Highway in Alaska (Curragh Mine Haul); and 

The U.S. has reconstructed Yukon’s Haines and Alaska Highways (Shakwak Project). 

Canadian infrastructure investment in Skagway port development can unblock current port 

capacity constraints that will otherwise increasingly impede Yukon resource development. 

The Yukon Heavy Haul Transportation System - Yukon has the most extensive 

highway system in Northern Canada embracing Alaska Highway, Klondike Highway and 

Dempster Highway connections to both Inside Passage and Arctic Ports. This system links 

most mineral production areas in the territory to tidewater at the Alaska Inside Passage Port 

of Skagway. It also provides direct trucking access from Watson Lake via Cassiar Highway 37 

in British Columbia to the B.C. Inside Passage Ports of Stewart, Kitimat and Prince Rupert. 

The CANOL Corridor is an unimproved, summer only, single lane route through Ross River 

that connects to the Klondike Highway at Whitehorse or Carcross. It offers the opportunity to 

combine a new short-cut to Skagway 

with “super load” mine haul trailers to 

substantially increase productivity of 

the Yukon heavy haul trucking system. 

The KLONDIKE Corridor is the 

principal port access route and 

running through it parallel to the 

heavy haul highway is the White Pass 

& Yukon Route railway, a legacy from 

Recommended Approach for 

Yukon Heavy Haul Transportation System 

Incremental rail and/or road investment where 

relatively high density mining traffic can support 

new modal systems to: 

significantly improve cost performance; and 

reduce resource development public impacts. 

an earlier period of intense mining activity and intermodal mine haul transportation in 

Yukon. The narrow gauge White Pass railway is currently active between Skagway and 

Carcross, but only for passenger trains operated during the summer tourist season. Rail track 

is in place, but not in service between Carcross and Whitehorse. 

The Phase 1 Demand Report forecasts Yukon mine haul activity to surge past previous peaks 

of around 600,000 tonnes/year within the next 5 to 10 years and to exceed 1 million 

tonnes/year within the next 10 to 15 years. As traffic density increases, so will the attraction 

of building on existing, underutilized rail infrastructure to achieve lower transportation rates 

with rail costs that decline as volumes increase. 

At the same time a parallel rail alternative can relieve the public highway impacts from 

rapidly growing mine haul truck traffic. These include increased highway maintenance 

requirements, increased greenhouse gas emissions, reduced public safety and reduced 

tourism attraction. This last impact is especially significant because of the importance of the 

Klondike Highway for Yukon’s tourism industry. 

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PROLOG CANADA INC.


4. NWT/Nunavut New Road Systems 

Many communities in the Northwest Territories and all communities in Nunavut have no allweather 

road connections to the southern Canadian highway system. Public investment 

proposals for the Mackenzie Valley Highway and for the Nunavut-Manitoba Road would start 

to close that infrastructure gap. 

While resource access roads will connect to these highways, the principal purpose is a public 

highway to connect communities – with a public interest in public investment. The Tibbitt to 

Contwoyto Winter Road, on the other hand, is exclusively a resource access road which is 

constructed each year at private sector expense. 

Both types of highway infrastructure investment are considered in this assessment: 

A Mackenzie Valley All-Weather Highway from Wrigley to Inuvik and from Inuvik to 

Tuktoyaktuk that in part or in full will benefit increased community and resource 

development access – and provide Canada’s only southern highway connection to an 

arctic port. The assessment identifies surface and air transportation savings for people 

and cargo that are compelling, exceeding annual highway maintenance costs, with a net 

transportation savings benefit that equals 20% of the capital cost of construction. 

A Seasonal Overland Road that can extend the operating season for the Tibbitt to 

Contwoyto Winter Road that serves NWT and Nunavut mineral properties in the Slave 

Geological Province. The assessment considers the risk that a warming climate will 

repeat the 100,000 tonne capacity shortfall of 2006 and the trade-off of a large SOR 

investment with a short life versus a smaller BIPAR investment with a long life. 

A Nunavut-Manitoba All-Weather Road Investment that with an initial inter-community 

regional distribution system could improve sealift cargo delivery via a single Kivalliq hub 

port. The assessment identifies the full investment benefit of year around, just-in-time 

trucking to reduce inventories and reorder lead times at no more cost than summer-only 

sealift. It also considers large air passenger and air cargo savings that in combination 

with sealift dry cargo diverted to trucks, exceed anticipated highway maintenance costs 

leaving net benefits that equal 15% of construction capital cost. 

Arctic All-Weather Road Construction South from Tukoyaktuk 



The Mackenzie Valley Highway System - is an extension of the existing NWT allweather 

and winter road system comprised of: 

The All-Weather Mackenzie Highway from Alberta to Wrigley; 

The Mackenzie Winter Road from Wrigley to Fort Good Hope; and 

The Inuvik-Tuktoyaktuk Winter Ice Road on the Mackenzie River East Channel. 

At present the all-weather NWT Mackenzie Highway 1 ends at Wrigley. A seasonal winter 

road connects Wrigley to Fort Good Hope via Tulita and Norman Wells. There is no road 

(winter or all-weather) between Fort Good Hope and Inuvik. A winter ice road along the 

Mackenzie East Channel connects Inuvik to Aklavik and Tuktoyaktuk 

Infrastructure investment in a new Mackenzie Valley Highway system will attract traffic from 

the two season Mackenzie River barge and Winter Road truck operations; from the longer 

Dempster Highway route to the Mackenzie Delta; and from Mackenzie Valley/Delta Air Cargo 

and Passenger services. This traffic potential is shown in the following recap of the Phase 1 

Mackenzie Valley and Delta/Beaufort Traffic Forecast. 

Recap of Phase 1 Mackenzie Valley & Delta/Beaufort Sea Traffic Forecast 

(Tonnes/Year) 

Mackenzie Valley 2009/10 2015 2020 2025 2030 

Barge Deck Cargo 7,844 

Winter Road Truck 1,300 


Mackenzie Basin Oil & Gas 6,000 27,000 27,000 40,000 54,000 

Mackenzie Delta/Beaufort Sea 

Dempster Hwy Truck 22,000 23,056 23,936 24,794 25,652 

Beaufort Sea Oil & Gas 4,000 8,000 8,000 12,000 

Mackenzie Delta Oil & Gas 38,000 38,000 54,000 76,000 

Mackenzie Valley/Delta Air Traffic 

Cargo Tonnes per Year 1,700 2027 2,353 2758 3,162 

Passengers per Year 119,193 136,953 151,136 166,870 178,273 

Many of the benefits of infrastructure projects such as the Mackenzie Valley Highway 

extension are difficult to quantify. An important consideration for the Mackenzie Valley 

Highway project is that it will help to mitigate potential impacts of climate change on the 

existing transportation system. 

According to Environment Canada, warmer than normal temperatures have occurred in 25 of 

the last 26 seasons and this warming trend has been strongest in northern Canada with the 

Mackenzie District showing the greatest increase of 2.3°C over the past 63 years of record. 

This warming trend in the NWT has and will continue to pose challenges and opportunities 

for the transportation system. 

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The Mackenzie Valley and other regions of the NWT transportation system rely on a number 

of ferries, ice bridges and winter roads to connect communities and provide access to 

resources. This system is subjected to winter freeze-up, spring break-up and other climatic 

influences that can affect the duration and reliability of the system. 

The variable nature of the transportation system adds uncertainty to development projects 

and poses challenges for community mobility, resupply and economic diversification. The 

existing limited transportation window makes development and exploration activities less 

efficient and more expensive. 

Climate change has impacted fall freeze up and spring thaw dates, which in turn has delayed 

the opening dates of ice bridges on all-weather highways and reduced the operating window 

of the winter road system. An incrementally developed all-weather road through the 

Mackenzie Valley would help alleviate problems associated with the reduction of winter road 

reliability, uncertainty of road opening and closing dates and reduced periods of operation. 

Staged all-weather road construction from the south to link up with permanent bridges 

already in place on the winter road system would provide timely transformation of the current 

intermittent system to one that increasingly functions 365 days per year. 

Recommended Approach for the Mackenzie Valley Highway System 

Incrementally replace winter road segments, as compromised by 

warmer weather, with corresponding extension of the all-weather 

road system from the south to provide increasingly better access for: 

Mackenzie Valley and Delta communities; 

Mackenzie Gas Pipeline Project construction; and 

Mackenzie Valley and Western Arctic Oil & Gas Development. 

Slave Geological Province Mine Haul System - The Slave Geological Province 

includes current and future mines in both the NWT and Nunavut. These mines are seasonally 

supported by annual construction of the Tibbitt to Contwoyto Winter Road (TCWR). In 2006 

a warm winter season lead to premature TCWR closure and consequent extremely costly 

airlift of over 100,000 tonnes of mine traffic for which truck delivery was precluded. There is 

concern that risk of premature road closure may become more frequent with a warming 

climate in the North. A seasonal overland road (SOR), parallel to southern portions of the 

TCWR has been proposed to mitigate this risk. 


Tonnes/Year 


As a context for this infrastructure assessment, the table below provides a recap of the 

relevant Phase 1 traffic demand projections for Slave Geological Province diamond mine 

resupply through 2030. 

Recap of Phase 1 Slave Geological Province Mine Supply Traffic Forecast 

(Tonnes/Year) 

Mine 2010 2015 2020 2025 2030 

Ekati Fuel 36,000 57,000 57,000 

Supply 12,000 18,000 18,000 

Diavik Fuel 18,000 69,000 69,000 69,000 

Supply 22,000 82,000 82,000 82,000 

Snap Lake Fuel 27,000 29,000 29,000 29,000 29,000 

Supply 6,000 12,000 12,000 12,000 12,000 

Gacho Kue Fuel 2,000 25,000 25,000 25,000 25,000 

Supply 1,000 18,000 18,000 18,000 18,000 

Total Fuel 83,000 180,000 180,000 123,000 54,000 

Supply 41,000 130,000 130,000 112,000 30,000 

All Traffic 124,000 310,000 310,000 235,000 84,000 

The following graph shows the years during which there is a risk that forecast traffic can 

exceed a nominal TCWR capacity constraint of 184,000 tonnes/year based on the 2006 

seasonal capacity shortfall. 

350000 

300000 

250000 

200000 

TCWR Potential Capacity Shortfall 

184,000 Tonnes Nominal Capacity Constraint 

150000 

100000 

Bulk Fuel Demand 

Other Mine Supply 

50000 

0 

2010 2015 2020 2025 2030 

The graph above also shows that if bulk fuel demand is removed from the TCWR capacity 

requirement, the residual of other mine supply traffic can be accommodated without any risk 

of a shortfall over the 20 year forecast period. The proposed Coronation Gulf Port and 

Winter Road would be extremely attractive for bulk fuel traffic that could be diverted from the 

TCWR and avoid any prospect of capacity shortfall. 

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As an alternative to the Coronation Gulf Port and Road option, a Seasonal Overland Road can 

replace the southern 170 km of TCWR with a 163 km parallel overland road. It is estimated 

that the SOR would add about 30 days to the current TCWR operating season. 

The SOR would be an “insurance policy” against the risk of warm winters and the added 

expense of airlifting displaced truck traffic in case of a warm winter. However, by the time the 

SOR is implemented most diamond mines may already be in production decline, which could 

make unattractive a large SOR investment with a short life cycle. The trade-off may well be a 

large SOR investment with a short life versus a smaller BIPAR investment with a long life. 

Recommended Approach for Slave Geological Province Mine Haul System 

Continue existing, privately funded, Tibbitt to Contwoyto Winter Road 

trucking system as lowest total cost mine supply system: 

for producing diamond mines; and 

for new mineral exploration and development 

The Nunavut-Manitoba Road System - The Kivalliq Region, while in closest 

proximity to the southern Canadian rail and road network, like the rest of Nunavut is 

dependent upon sealift for resupply shipments that can only be scheduled in the limited 

summer season – and on air transport for everything else. 

Incremental investment in a Nunavut-Manitoba road system is proposed in stages that will 

first connect Rankin Inlet, Whale Cove and Arviat in the Kivalliq Region. Each stage of 

development would include truck transport currently unavailable between Kivalliq 

communities and the rest of Canada, with connection: 

to intermodal rail service at Churchill, initially by a cross-boundary winter road, followed 

by completion of a year around all-weather road; and 

to the Manitoba Highway system following completion of the final stage of all-weather 

road construction linking Churchill to Gilliam. 

The specific transportation benefits of 

the full Nunavut - Manitoba Road 

development include a shift of sealift 

general cargo to fast, frequent 

highway general freight; air cargo 

shift to much less expensive trucking; 

and air passenger shift to personal 

vehicle travel. Initial development of 

an inter-community road system may 

also provide some interim sealift 

benefit for regional hub distribution. 

Baker 

Lake 

Hudson Bay Transportation System 

Performance Changing Alternatives 

Chesterfield 

Inlet 

Future 

Nunavut- 

Manitoba 

Road 

Rail ex Thompson 

& Winnipeg 

Rankin 

Inlet 

Arviat 

Churchill 

Via Churchill 

Sealift 

Sealift 

Via Montreal 



Current Kivalliq sealift and air transport forecasts will change significantly with Nunavut- 

Manitoba Road System development. As a baseline from which to recast future traffic shifts, 

the table below recaps the Phase 1 forecast of sealift and air transport for Kivalliq Region 

mines and communities assuming no change in current modal split. 

Recap of Phase 1 Traffic Forecast for the Kivalliq Region 

FORECAST TONNAGES FOR THE KIVALLIQ REGION 

(Tonnes/Year) 

Sealift Transport 

2010 2015 2020 2025 2030 

Mines 

General Freight 17,100 38,100 68000 68,00068000 16,500 17,100 

Bulk Fuel 23,200 52,200 78,000 78,00078000 24,000 23,200 

Total 40,300 90,300 146,000 146,000 40,500 40,300 

Communities 

Air Transport 

General Freight 14,592 15,403 16,126 16,748 17,892 17,292 

Bulk Fuel 27,696 29,233 30,606 31,786 32,029 32,829 

Total 42,288 44,636 46,732 48,534 49,921 50,121 

TOTAL 

CommunitiesKitik 

General Freight 31,692 53,503 84,126 84,748 34,392 

meot 

Bulk Fuel 50,896 81,433 108,606 109,786 56,029 

Total 82,588 134,936 192,732 194,534 90,421 

Air Cargo (tonnes/year) 4,298 5,457 6,615 8,205 9,705 

Air Passenger (psgrs/year) 175,000 197,050 217,525 240,275 265,300 

Highway connection to the railhead at Churchill, Manitoba or to the roadhead at Gilliam, 

Manitoba could substantially change the cost and service performance of the transportation 

system in the Kivalliq Region. 

Recommended Approach for the Nunavut-Manitoba Road 

Integrated development of an all-weather and winter road system providing 

inter-community connections first, followed by connections to the rest of Canada, 

gradually transforming the Kivalliq Region transportation system with: 

Initial potential for regional sealift cargo distribution; 

Interim Intermodal Integration via Churchill railhead; and 

Ultimate all-year alternative for sealift cargo, air cargo and air travel. 

Intermodal Railhead at Port 

of Churchill, Manitoba 

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PROLOG CANADA INC.


5. Northern Air Transport Systems 

At many northern communities the movement of people and goods is only accomplished by 

seasonal surface transport or by air. Air transportation also provides a crucial link to 

essential services and work opportunities that are often not available within the community. 

Ongoing incremental infrastructure investment continues to meet the requirements of 

isolated northern communities for passenger, cargo and medevac services as well as for 

inconsistent resource development demand - and compliance with changes in the Canadian 

Aviation Regulations. Currently anticipated northern airport infrastructure needs include 

the following priority capital projects: 

Iqaluit Airport – In excess of $200 million capital investment estimated for runway 

repaving, airfield electrical system replacement, combined services building and 

including a new $60 million air terminal building. 

Cambridge Bay Airport - $34.4 million in short-term improvements to extend apron, 

upgrade runway lighting and landing systems and including $10 million to shore up the 

gravel runway. Longer term, within 5 years runway paving and extension, and within 10 

years air terminal building expansion, is required. 

Rankin Inlet Airport - $32.2 million for short-term improvements to construct a new 

taxiway, extend aircraft parking apron and expand the air terminal building. Longer 

term, additional 50% expansion of the air terminal building is required. 

Whitehorse International Airport - $15.7 million air terminal building expansion 

completed in 2010 to accommodate international flights, including currently Condor and 

potentially Swiss Air, with continuing flights to Alaska. 

Mayo Airport - $2.2 million over 5 years for visual approach navaids and to rebuild 

runway due to permafrost degradation, including $1.5 million for runway resurfacing, 

apron and taxiway reconstruction. Pending scheduled service will require additional 

investment for airport recertification. 

Faro Airport - $1 million over 5 years for new air terminal building, apron expansion and 

airside resurfacing. Additional investment may be required to accommodate intense 

resource development activity currently anticipated. 

Northwest Territories – $20.7 million Yellowknife Airport Combined Services Building 

recently completed and $6 million in runway extension projects currently underway or 

completed at Tulita, Fort Good Hope and Fort McPherson. 

Recommended Approach for the Northern Air System 

Maintain highest possible standards with additional air system capacity 

investment as required to support largely roadless northern communities 

heavily dependent on air transport: 

For travel, medevac and other essential services; 

For all-season resupply including food and mail; and 

For sustainable resource, tourism and other economic development. 



6. Conclusions 

Following are key findings from the Northern Transportation Systems Study: 

Combined with incremental community harbour improvements ongoing in 

Nunavut, the full scale of transportation infrastructure proposed for the Mary River 

Iron Mine on Baffin Island may create spin-off opportunities for long term 

community resupply improvement in the Qikiqtaaluk Region. 

Staged development of a Coronation Gulf Port and Road could initially provide 

lower cost inbound bulk transport for existing Diamond Mines in the Northwest 

Territories with early project revenues for subsequent full facility development to 

support base metal mining in the Kitikmeot Region of Nunavut. 

Port, rail and/or road infrastructure investments would provide the resource 

development industry in Yukon with lower cost tidewater access to help mineral 

exports stay competitive in the Asian market. 

Incremental investment in both the proposed Mackenzie Valley Highway and the 

Nunavut-Manitoba Road could initially improve community resupply reliability, 

local goods distribution and regional resource development access; and ultimately 

supplement high cost air cargo and passenger transport with all-weather road 

connections to the southern highway system. 

Runway extensions, new aprons and air terminal buildings may be required for 

workforce crew changes and air cargo support for the large scale resource 

development projects being considered over the next 20 years. 

This report concludes with the following high level financial summary that should be 

considered as a first step in helping to prioritize infrastructure investments in the North. 

Project benefits that are not quantified here include increased safety, reliability, community 

development and environmental protection. Though less easily monetized, these benefits may 

be equally, if not more, significant to infrastructure decisions in a changing Northern climate. 

Infrastructure 

Investment 

Project 

Investment 

Capital 

Cost 

Internal 

Rate of 

Return 

Net 

Present 

Value 

Benefit 

To Cost 

Ratio 

Pay 

Back 

Period 

Skagway Mineral Export Terminal $81 million 40% $431 million 7 : 1 3 yrs 

Canol Corridor Super Load Road $52 million 20.5% $209 million 5.4 : 1 7 yrs 

Klondike Corridor Rail to Whitehorse $67 million 17.1% $174 million 4 : 1 8 yrs 

Yukon Hwy 1 & 2 Truck Lane Build-Out $82 million 11.3% $72 million 2 : 1 10 yrs 

Coronation Gulf Port & Road(BIPAR) $127 million 10.6% $52.5 million 1.5 : 1 8 yrs 

NWT Seasonal Overland Road * $192 million 9% $55 million 1.3 : 1 8 yrs 

Standard Gauged Rail to Carmacks $576 million 8.4% $237 million 1.5 : 1 12 yrs 

Iqaluit Sealift Ramp/Staging Site $22 million 6.1% $2.6 million 1.2 : 1 15 yrs 

Iqaluit Deep Water Port $65 million -1.2% -$34 million .44 : 1 30 yrs 

Mackenzie Valley All-Weather Hwy $1.8 billion -4.9% -$1.3 billion .20 : 1 50+ yrs 

Nunavut-Manitoba All-Weather Hwy $1.3 billion -6.8% -$1.0 billion .15 : 1 50+ yrs 

* assuming highest risk of warm winter/short season (every 5 years). 

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PROLOG CANADA INC.


Although the financial assessments are derived from shipper savings, which are not the same 

as commercial revenue streams or broader socio-economic benefits, they do provide a high 

level indication of the relative attraction for public and/or private investment. Moving 

toward the top of the table, investments show increasing private sector financial viability. 

Moving toward the bottom of the table, investments show increasing requirement for public 

interest financing. 

Resource projects will increase the prospects for private sector financing of northern 

transportation infrastructure. Governments should look closely for any opportunities to 

piggyback community resupply benefits on resource development projects. Public sector buyin 

to a private sector project can leverage the legacy of northern transportation infrastructure 

investment. To further that legacy in a harsh environmental and financial climate requires 

careful consideration of all options for cost sharing partnerships where multiple needs can be 

met with a single multi-use facility. 

White Pass & Yukon Route Railway at Carcross, Yukon (2010)

The Northern Transportation Systems Assessment - NWT & Nunavut ...

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